Gasoline and diesel prices set to rise after 2021 assembly elections

Gasoline and diesel prices may soon rise after the current Assembly elections are over, oil companies will …

Gasoline and diesel prices set to rise after 2021 assembly elections

Gasoline and diesel prices could soon increase at the end of the current Assembly elections, with oil companies seeking to increase the retail price of the two car fuels between Rs 2 and Rs 3 per liter in stages and compensate the losses they suffered in keeping the price artificially low in the run-up to local elections. Government sources said that oil companies were suffering losses in the order of Rs 3 and Rs 2 per liter respectively on the sale of gasoline and diesel, due to the rise in world crude prices which also had a negative impact. impact on international product prices. Gasoline and diesel prices have not been increased since February 27, but in fact, auto fuel prices have fallen four times in March and April, pushing gasoline prices down by 77 paisa. the liter and diesel of 74 paisa the liter in the national capital. The drop came even though the average price of crude in the Indian basket was around $ 61.22 in February, below the March average of $ 64.73 and averaging nearly $ 66 per barrel in March. April until now.

Although the retail price of gasoline and diesel prices is determined on the basis of a 15-day moving average of the product price around the world, the downward revision in retail prices has resulted in losses for the WTO on the sale of the two products and would no longer wait for elections to revise pump prices upwards. There is a caveat, however. The revision would depend on the indications of the government. A source from a public sector oil company said that a stronger rupee would make crude cheaper for businesses and therefore the actual adjustment in retail gasoline and diesel prices might not be heavier. . But it will all depend on how the rupee sets against the dollar in April. “Oil PSUs have avoided raising oil prices in tandem with global crude rates for over a month now and the trend may well continue until the end of the month, when national elections come to an end. So, it wouldn’t be a surprise if domestic oil prices rise sharply after the end of the election season, unless the Center issues a new notice to stagger the required hike to avoid public outrage in the middle. of the raging pandemic, “said an energy sector expert from a global audit and consulting firm, who declined to be named.

MOCs have been soft on rising gasoline and diesel prices since early March 2021 when election dates for the states were announced. In fact, they have driven prices down for the first time this year for two consecutive days – March 24 and 25 – after keeping oil prices stable for the past 24 days. He lowered the price again on March 30. Subsequently, fuel prices remained unchanged for the last 15 days before falling again on April 15. Earlier, gasoline and diesel prices were increased 26 times in 2021, with both automotive fuels increasing by Rs 7.46 and Rs 7.60 per liter, respectively, so far this year. This should be offset by a gradual increase in retail gasoline and diesel prices for a few days before the fuel is brought up to par with world market prices. Assembly elections were held in Tamil Nadu, Kerala, Assam and Pondicherry, while the final round of voting in West Bengal will take place on April 29. All results will be announced on May 2.